Council tax freeze safeguarded as John Swinney is compared to Margaret Thatcher

A source close to finance secretary John Swinney told The Scotsman that the Scottish Government could not "see any council rejecting this agreement" to accept key SNP policies in exchange for funding to protect services.

The claim came amid accusations from the leader of Scotland's biggest council that Mr Swinney's warning that local authorities would have 6.4 per cent slashed from their funding if they did not agree to the deal was worse than in the "darkest days of Tory rule".

Glasgow City Council's Labour leader Gordon Matheson made the claim in a letter to Mr Swinney in which he said: "It is with a gun to my head that I agree to your short-term targets".

However, the rest of Scotland's councils are also expected to follow suit, with one of the leaders of local government body Cosla saying he would "be surprised" if any authority rejected the terms of the deal involving a 2.6 per cent cut for those signing up.

Neil Fletcher, a Lib Dem vice-president at Cosla, said: "Because of the financial situation that local councils face, they would lose significant amounts if they refused to agree on this, and I would be surprised if any of them do.

"It's up to the individual local councils whether they take this deal or not, and that's the position Cosla is taking."

Aberdeen City Council deputy leader Kevin Stewart said that the arrangement offered to Scottish authorities "was a much better deal" than the one handed to councils in England.

Meanwhile, a source close to the finance secretary hit back at Mr Matheson and claimed that Glasgow had "caved in" over its opposition to the council tax freeze and funding deal.

The source said: "Gordon Matheson was itching to increase the council tax in Glasgow, and Labour at Holyrood wanted to scupper the deal because the council tax freeze and police number policies are so popular and successful."The fact that Glasgow has caved in tells its own story - we don't see any council rejecting this agreement because it is the best available in the face of the Westminster cuts, and local authorities in England would give their eye teeth for the sort of deal we are offering in Scotland."

Scottish Labour's local government spokesman, Michael McMahon, accused Mr Swinney of deceiving local councils over the deal.

He said: "Mr Matheson's damning letter shows John Swinney has deceived local authorities who are now having to go back to the drawing board to find additional cuts.

"The SNP's deal will mean more cuts to frontline services; our children's education will suffer, there will be further reductions in services for pensioners and things like potholes in our roads won't get fixed. The finance secretary has backed councils into a corner.

"He is refusing to give them the freedom that they need to protect vital services on which we all depend."